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Wednesday, 19 November 2014

The invention of laws and regulations is
celebrated as great success principle of societies and they are, of course,
important. However, a major part of social order is based on self-organization,
which builds on simple social mechanism. These mechanisms have evolved over
historical times and are the basis of the success or failure of civilizations.
Currently, many people oppose globalization, because traditional social
mechanisms fail to create cooperation and social order under globalized
conditions that are increasingly characterized by homogeneous or random interactions.
However, I will show that there are other social mechanisms such as reputation
systems, which will work in a globalized world, too.

Since the origin of human civilization,
there has been a continuous struggle between chaos and order. While chaos may
stimulate creativity and innovation, order is needed to coordinate human action,
to create synergy effects and greater efficiency. Our success also critically
depends on the ability to produce "collective goods", such as our
transportation infrastructures, universities, schools, and theaters, as well as
language and culture.

According to Thomas Hobbes (1588-1679),
civilization started with everyone fighting against everybody else ("homo
hominis lupus"), and it required a strong state to create social order.
Even today, the merits of civilization are highly vulnerable, as the outbreak
of civil wars illustrate, or the breakdown of social order after a natural
disaster. But we are not only threatened by the outbreak of conflict. We are also
suffering from serious cooperation challenges, which often arise out of "social
dilemma situations."

The challenge of cooperation

To understand the nature of "social
dilemmas," let us discuss the problem of producing "collective goods."
For illustration, assume a situation in which you and others engage in creating
and using something together (the "collective good"). Then, everyone
invests a certain contribution that, in some way or another, goes into a "common
pot". If the overall investment reaches a sufficient size, it creates a
synergy effect and produces benefits. To reflect this, the total investment, i.e.
the amount in the pot, is multiplied with a factor greater than 1. Finally, the
resulting overall amount is assumed to be equally split among all contributors.

In such situations, you cannot benefit if
you don't invest. In contrast, if everyone invests a sufficiently high amount,
everyone gains, as the investment is assumed to create a synergy effect. But if
you invest much and others little, you are likely to walk home with a loss. Conversely,
a low investment may produce an individual advantage, as long as the others
invest enough.

Therefore, cooperation (contributing much)
is risky, and free-riding (contributing little) is tempting, which destabilizes
cooperative behavior. If the situation occurs many times, cooperation erodes,
and a so-called "tragedy of the commons" results. In the worst case, nobody
invests anymore in the end and nobody will get a benefit. This is pretty much the
situation one can find in countries characterized by high levels of corruption
and tax evasion.

Therefore, cooperative behavior, even
though beneficial for everyone, can break down for similar reasons as free
traffic flow breaks down on a crowded circular road: the desirable state of the
system is unstable. See the Video.
But given that it's possible to stabilize free traffic flows by means of
traffic assistance systems, are there any biological or socio-economic mechanisms
that can stabilize social cooperation?

An outcome that is bad for everyone

"Tragedies of the commons" are known
from many areas of life. Often cited examples are the degradation of our environment,
overfishing, the exploitation of social benefit systems, or dangerous climate
change. In fact, even though probably nobody wants to destroy our planet, we
still exploit its resources in a non-sustainable way and pollute our Earth. For
example, a good solution how to safely keep nuclear waste has still not been
found. Moreover, nobody wants to be responsible for the extinction of a species
of fish, but we are facing a serious overfishing problem in many areas of the
world. We also know that public schools, public hospitals, and many other useful
investments made by the state require our taxes. Nevertheless, the problem of
tax evasion is widespread.

Now, the reader will argue: of course, we
can make contracts and establish institutions such as courts to ensure that
they will be kept. This is correct, but what institutions shall we establish? How
efficient are they? And what are their undesired side effects? In an attempt to
address these questions, the following paragraphs will give a short and
certainly incomplete overview of mechanisms that support cooperation – and have
played a major role in human history.

Family relations

An early mechanism invented to promote
cooperation in social dilemma situations, first discussed by George R. Price
(1922-1975), is called "genetic favoritism". This means that, the closer
you are genetically related with someone else, the more advantages you would give
to him or her as compared to strangers. This principle has led to tribal
structures and dynasties, which have been around for a long time – and still are
in many countries. Today's inheritance law favors relatives, too. However, genetic
favoritism has a number of undesirable side effects, such as a lack of fair
opportunities for non-relatives, and also ethnic conflicts or blood revenge.
The drama of Romeo and Juliet articulates the impermeability of family structures
in the past very well. Another well known example is the Indian caste system.

Scared by future "revenge"

What other options do we have? Repeated
interactions, as they already occurred in early human settlements, are an
example. In case you interact with the same person time and again, you may play
tit for tat or some other strategy that teaches your interaction partner that
non-cooperative behavior won't pay off. The strategy is thousands of years old
and is also known as "an eye for an eye, a tooth for a tooth."

The effectiveness of such revenge
strategies was studied in 1981 by Robert Axelrod (*1943) in his famous computer
tournaments. It turned out that, if you would interact with me just frequently
enough, mutual cooperation would beat exploitation strategies. This effect is
also known as "shadow of the future". As a consequence, a situation
of "direct reciprocity" is expected to result, in which "I help
you and you help me." But what if our friendship becomes too close, such
that the result is good for us but bad for others? This could lead to corruption
and impermeable, inefficient markets.

Moreover, what should we do if we interact
with someone only once, for example, a renovation worker? Will we then have to
live with a bad experience that we are likely to make? And what should we do, if
a social dilemma situation involves many players? Then, a tit-for-tat strategy
is too simple, because we don't know who cheated us and who didn't.

Costly punishment

For such reasons, further social mechanisms
have emerged, which include "altruistic punishment". As Ernst Fehr
and Simon Gächter have shown in 2002, if players can punish others, this will
promote cooperation, even when punishment is costly. This effect is so
important that people, if faced with the option to choose between a world
without punishment and a world offering a sanctioning option, often decide for
the second one. The experimental discovery of this was made as late as 2006 by Özgür
Gürek, Bernd Irlenbusch, and Bettina Rockenbach. Punishment efforts are mainly
needed in the beginning, to teach people "to behave", i.e. to be
cooperative. In the end, the punishment option may be rarely used. But for
cooperation to persist, the punishment option still needs to be there (or
another mechanims which can stabilize cooperation).

Note that such mutual "peer punishment" is a widespread mechanism. In particular, it is used to stabilize
social norms, i.e. behavioral rules. Every single one of us probably exercises
peer punishment many times a day – sometimes in a mild way (e.g. by raising
eyebrows), and sometimes more furiously (e.g. when shouting at others).

The birth of moral behavior

But why do we punish others at all, if it
reduces our own payoff, while others benefit from the resulting cooperation?
This puzzle is called the "second-order free-rider dilemma", where "first-order
free-riders" mean non-cooperators and "second-order free-riders"
mean non-punishers.

To answer the above question, in a study
with Attila Szolnoki, Matjaz Perc György Szabo in 2010, I have analyzed a
collective goods problem considering four possible behaviors: (1) cooperators
who don't punish non-cooperators, (2) cooperators punishing non-cooperators,
called "moralists" (green), (3) non-cooperators punishing other
non-cooperators, called "immoralists" because of their hypocritical
behavior (yellow), and (4) non-cooperators who don't punish (red). We
furthermore assumed that individuals imitate the best performing behavior
played by their interaction partners.

If the interaction partners were randomly
chosen from the entire population, moralists couldn't compete with cooperators
– due to the additional punishment costs. Therefore, cooperators ended up in a
social dilemma situation with non-cooperators, which they lost, and a "tragedy
of the commons" occurred. However, if individuals interacted with a small
number of neighbors, we found the emergence of clusters of people, in which the
same behavior prevailed (see picture below). Surprisingly, the fact that
"birds of a feather flock together" makes a big difference for the
outcome of the interactions: it allows moralists to thrive. Assuming all other
things to be equal, in the spatial (rather than random) interaction scenario,
cooperators lost the battle with non-cooperators in their neighborhood, as
expected, but moralists could cope with them (as their punishment of
non-cooperators reduced the success of non-cooperative behavior). Therefore,
when individuals interacted with neighbors in geographical space or social
networks rather than with random interaction partners, moral behavior could win
its way and second-order free-riders were crowded out. As a consequence, "moral
behavior", i.e. cooperation and the punishment of non-cooperative behavior
thrived.

Nevertheless, punishing each other is often
annoying or inefficient. This is one of the reasons why we may prefer so-called
"pool punishment" over the above "peer punishment". In such
a case, we invest into a common pot paying for a police or court or other
institution sanctioning improper behavior. But a problem of this approach is
that representatives of the punitive institution may be corrupt. Besides this
corruption problem, it is often far from clear, who deserves to be punished and
who not.

We must certainly be careful not to
sanction the wrong people. This requires high inspection and discovery efforts,
which might not always be justified by the success rates. Then, lack of success
may lead to less inspection and eventually to more crime – a strange interdependency
pointed out by Heiko Rauhut, which might explain the crime cycles that have often
been observed in the past. To our great surprise, the computer simulations of
the spreading and fighting of criminal behavior that I performed in 2013 together
with Karsten Donnay and Matjaz Perc suggest that more surveillance and greater
punishment, i.e. more deterrence, are not able to eliminate crime. In fact,
while there is an almost 10 times higher rate of prisoners in the USA than in Europe,
crime rates do not seem to be lower. In fact, I expect a crime prevention
strategy based on the consideration of socio-economic factors to be much more
effective than one mainly based on deterrence.

Group selection and success-driven
migration

Things become even more tricky if we have
several groups with different preferences, for example, due to different
cultural backgrounds or education. The subject has become popular under the
label of "group selection", which was promoted by Vero Coppner
Wynne-Edwards (1906-1997) and others.

In fact, it seems that group competition
can promote cooperation. Compare two groups: one with a high level and one with
a low level of cooperation. Then, the more cooperative group is expected to get
higher payoffs, such that it should grow more quickly compared to the
non-cooperative group. Consequently, cooperation should spread and free-riding
disappear. However, what would happen if there existed an exchange of people
between the two groups? Then, free-riders could exploit the cooperative group
and quickly undermine the cooperation in it.

The surprising role of migration

Can cooperation only thrive in a world
without migration and exchange? Surprisingly, the contrary is true if the
conditions are right. In computer simulations I performed in 2008/09 together with
Wenjian Yu, we have studied success-driven migration. Our simulations made the
following assumptions: (1) Individuals move to the most favorable location
within a certain radius around their current location ("success-driven migration").
(2) They tend to imitate the behavior of the most successful interaction
partner (neighbor). (3) With a certain probability, the individual migrates to
a free location, or it flips its behavior (from cooperative to non-cooperative
or vice versa). Rule (1) does not change the number of cooperators, while all
the other rules undermine significant levels of cooperation. Nevertheless, when
all three rules are applied together, a surprisingly high level of cooperation
emerges after a sufficiently long time. This is even true when the computer simulation
is started with no cooperators at all, as Thomas Hobbes assumed to be the
initial state of society. How is this possible, in spite of the fact that we
don't assume a "Leviathan", here, i.e. a strong state, which imposes
cooperation in a top-down way?

It turns out that migration disperses
individuals in space. However, the rare flipping of individual behaviors
creates a few cooperators. After a sufficiently long time, some cooperators are
randomly located next to each other by sheer coincidence. In such a cooperative
cluster, cooperation is rewarding, and neighboring individuals imitate this
successful behavior. Afterwards, cooperation spreads quickly all over the
system. Cooperative individuals move away from non-cooperative ones and join
other cooperators to form clusters. Eventually, the system is dominated by
large cooperative clusters, with a few non-cooperative individuals at their
boundaries. Therefore, we find that individual behavior and social neighborhood
co-evolve, and individual behavior is determined by the behavior in the neighborhood
(the "the milieu").

In conclusion, when people can freely move
and live in the places they prefer, this can largely promote cooperation, given
that they are susceptible to the local culture and that they quickly adapt to successful
local behaviors. Thus, migration isn't a problem, while lack of integration may
be. But it takes two to be friends. Integration requires efforts on both sides,
the migrants and the receiving society.

Migration is not always welcomed, even
though it has always been part of human history. Many countries struggle with
migration and integration. However, the United States of America, known as the "melting
pot", are a good example for the positive potential of migration. This
success is based on the principle that, in the USA, it is relatively easy to
interact with strangers.

Another positive example is the Italian
village Riace, in which the service sector was gradually disappearing, as young
people were moving away to other places. But one day, a boat with migrants
stranded. The mayor interpreted this as a divine sign, and decided to use this
as an opportunity for his village. And, in fact, a miracle occurred. Thanks to
the migrants, the village was revived. Since they were welcomed, they were
grateful and gave a lot of good things back to the old inhabitants of the
village. As the migrants were not treated as foreigners, but as part of the
community, a trustful relationship could grow.

Common pool resource management

Above, I have described many simple social
mechanisms that can be and have been tested for their effectiveness and
efficiency in laboratory settings. They are also known to play a role in
reality. But what about more complex socio-economic systems? Would
self-organization be able to create desirable and efficient solutions? This is
what Elinor Ostrom (1933-2012) studied – and what she got the Nobel prize for.
It is often claimed that public ("common pool") resources cannot be
efficiently managed, and that's why they should be privatized.

Elinor Ostrom discovered that this argument
is actually wrong. She studied the way in which Common Pool Resources (CPR)
were managed in Switzerland and elsewhere, and found that self-governance works
well, if only the interaction rules are suitably chosen (read more).
One suitable set of rules that provide good conditions for successful
self-governance is specified below:

Rules regarding the appropriation and provision of common resources exist that are adapted to the local conditions.

The collective choice arrangements allow most resource appropriators to participate in the decision-making process.

There is an effective monitoring by people who are part of or accountable to the appropriators.

A list of graduated sanctions is applied to resource appropriators who violate community rules.

Mechanisms of conflict resolution exist that are cheap and easy to access.

The self-governance of the community is recognized by higher-level authorities.

In the case of larger common-pool resources, the system is organized in the form of multiple layers of nested enterprises, with small local CPRs at the base level.

As it turns out, public goods can even be
created under less restrictive conditions. This amazing fact can be observed in
communities of volunteers – from Linux
over Wikipedia, Open Streetmap, and StackOverflow to Zooniverse and many other
forums.

The problem of globalization

One take home message of this chapter is
that self-organization based on local interactions is at the heart of all
societies in the world. Since the very beginning of ancient societies until
today, a great deal of social order emerges in a bottom-up way, based on
suitable interaction mechanisms and institutional settings. This approach is
flexible, adaptive, resilient, effective and efficient.

The mechanisms enabling bottom-up
self-organization discussed before promote the interaction of agents with
mutually fitting behaviors: "birds of a feather flock together". The
crucial question is: are these mechanisms also effective in a globalized world?

One may say that the process of globalization
creates increasingly "well-mixed" interactions: ever more people or
companies interact with each other, often in more or less anonymous or random ways.
Such conditions, unfortunately, promote an erosion of cooperation and social
order.

This undesirable effect is illustrated by a
video.
It illustrates a ring of "agents" (e.g. individuals or companies),
each engaged with their neighbors in the creation of collective goods. The
local interactions initially promote a high level of cooperation. But then we
add more and more interaction links with other, randomly chosen agents in the
system. While the additional links help to increase the level of cooperation in
the beginning, cooperation soon starts to drop, as the connectivity increases,
and it finally goes to zero. In other words, when too many agents interact with
each other, a "tragedy of the commons" results, where everyone is
suffering from a lack of cooperation. Data from Andrew Haldane from the Bank of
England suggest that, for example, the financial meltdown in 2008 might have
resulted from a hyper-connected banking network.

Age of coercion or age of reputation?

In fact, citizens and politicians all over
the world have noticed that our economy and societies, and the foundations they
are built on, are destabilizing. In an attempt to stabilize our socio-economic
system, governments all over the world have undertaken attempts to establish
social order in a top-down way, based on surveillance and powerful institutions
such as armed police. However, this approach is destined to fail due to the
high level of systemic complexity, as I have pointed out in a previous chapter.
In fact, we are seeing a lot of evidence for this failure: signs of economic,
social and political instabilty are almost everywhere. Will our globalized
society just collapse and break into pieces, thereby re-establishing a
decentralized organization? Or is there any chance to live in a globalized
world, in which cooperation and social order are stable? Could we perhaps build
something like an assistance system for cooperation?

In fact, it is known that reputation
systems can promote cooperation through "indirect reciprocity". Here,
the principle is that someone helps you, while you help somebody else.
Reputation mechanisms support people and companies with compatible preferences
and behaviors in finding each other. In a sense, such a reputation system can
also serve as a kind of "social immune system", protecting us from
harmful interactions.

Pluralistic, community-driven reputation
systems

These days, reputation and recommender
systems are quickly spreading all over the Web, which stresses their value. People
can rate products, news, and comments, and they do! There must be a good reason
that people undertake this effort. In fact, they get useful recommendations in
exchange, as we know it from amazon, ebay, tripadvisor and many other platforms.
As Wojtek Przepiorka and others have found, such recommendations are beneficial
not only for users, who tend to get a better service, but also for companies. A
higher reputation allows them to sell products or services at a higher price.

But how should reputation systems be
designed? It is certainly not good enough to leave it to a company to decide,
what recommendations we get and how we see the world. This would promote
manipulation and undermine the "wisdom of the crowd", leading to bad
outcomes. It is, therefore, important that recommender systems do not reduce
socio-diversity. In other words, we should be able to look at the world from
our own perspective, based on our own values and quality criteria. Otherwise,
according to Eli Pariser, we will end up in a "filter bubble", i.e.
in a small subset of the information society that fits our taste. But we may
lose our ability to communicate with others who have different points of views.
In fact, some analysts think that the difficulty in finding political
compromises between republicans and democrats in the USA is related to the fact
that they use increasingly different concepts and words to talk about them. In
a sense, they are living in different, largely separated worlds.

Therefore, reputation systems would have to
become much more pluralistic. When users post ratings or comments on products,
companies, news, pieces of information, and information sources, including
people, it should be possible to assess not just the overall quality (as it is
often done on a five-star scale or even just by a thumb up or down). The
reputation system should support different quality dimensions such as the
physical, chemical, biological, environmental, economic, technological, and
social qualities. Such dimensions may include popularity, durability,
sustainability, social factors, or how controversial something is.

Moreover, users should be able to choose
from diverse information filters (such as the ones generating personalized
recommendations), and to generate, share, and modify them. I want to call this
approach “social filtering”. A simple system of this case has been implemented
in Virtual Journal. Then,
we could have filters recommending us the latest news, the most controversial
stories, the news that our friends are interested in, or a surprise filter. So,
we could choose among a set of filters that we find useful. To consider
credibility and relevance, the filters should also put a stronger weight on
information sources we trust (e.g. the opinions of friends or family members),
and neglect information sources we do not want to rely on (e.g. anonymous
ratings). For this purpose, users should be able to rate information sources as
well, i.e. other raters. Then, spammers would quickly lose their reputation
and, with this, their influence on the recommendations made.

Altogether the system of personal information
filters would establish an "information ecosystem", in which
increasingly good filters would evolve by modification and selection, thereby
steadily enhancing our ability to find meaningful information. Then, the
pluralistic reputation values of companies and their products (e.g. insurance contracts
or loan schemes) would give a pretty differentiated picture, which could also
help the companies to develop better customized and more successful products.
Hence, reputation systems can be good for both, customers and producers.
Customers will get better offers, and producers can take a higher price for
better quality. This is serving both sides.

In summary, the challenge of creating a
universal, pluralistic reputation system might be imagined as transferring the principles,
on which social order in a village is based, to the "global village", i.e. to the conditions of a globalized world. The underlying success principle
is the matching of people or companies sharing compatible interests. A crucial
question is, how to design reputation systems in a way that would make them
resistant to manipulation and provide enough freedom for privacy and innovation?
Information Box 1 offers some related ideas.

Social Information Technologies

Reputation systems are just one possibility
to promote social order and favorable outcomes of social interactions. As we
have seen before, many problems result when people or companies don't care
about the impact of their decisions on others. This may deteriorate everyone's
situation, as in "tragedies of the commons", or cause mutually
damaging conflicts. How do we overcome such problems? How tdo we promote more
responsible behaviors and sustainable systems? The classical approach to this
is to invent, implement and enforce new legal regulations. But people don't
like to be ruled, they can't handle many laws, and they often find ways around
them. As a consequence, laws are often ineffective. Nevertheless, with Social
Information Technologies it is possible to create a better world, based on
local interactions and self-organization. It's actually easier than one might
think.

Today, smartphones are increasingly
becoming assistants to manage our lives. They guide us to find fitting
products, nice restaurants, the right travel connection, and even a new
partner. In the future, such personal assistants will be less and less focused
on self-centered services. They will pay attention to the interactions between
people and companies, and they will produce benefits for all involved parties
and the environment, too. Note that, when two people or companies interact,
there are just four possible outcomes, among them coordination failures and
conflicts of interest.

In the first case, the interactions would be
negative for both sides, i.e. it would be a lose-lose situation. It is pretty
clear what to do in such situations: one should avoid the interaction in the
first place. For this to happen, we need information technologies that make us
aware of the negative side effects of the interaction. Similarly, if we knew
the social and environmental implications of our interactions on the
environment, we could take better decisions. Measuring the externalities of our
actions is, therefore, an important precondition for avoiding damage. In fact,
if we had to pay for the externalities caused by our decisions and actions,
then individual and collective interests would become more aligned. As a
consequence, we wouldn’t run so easily into traps where individual decisions cause
overall damage.

The second case is that of a bad win-lose
situation, i.e. one side would have an advantage of the interaction, while the
other side would suffer a disadvantage, and altogether the interaction would be
damaging. In this situation, one side is interested in the interaction, but the
other side would like to avoid it. Again, increasing awareness may help, but we
would also need social mechanisms that would protect the potential loser from
exploitation.

The third case concerns good win-lose
situations. While the interaction would again be favorable for one side and
unfavorable for the other, overall there would be a systemic benefit of that
interaction. Consequently, one side would be interested in the interaction, but
the other side would want to abstain from it. It is possible though to turn the
win-lose situation into a win-win situation, namely by a value transfer. In
this way, the interaction becomes profitable for both sides, which would hence
engage in it.

Finally, in the fourth situation, the
interaction would create a win-win situation. There are nevertheless two things
one might do: balance the gains in a fair way, and create awareness of
opportunities one would otherwise miss. In fact, every day, we are walking by
hundreds people, who might share some interests with us, but we don't even know
about it. These may be a hundreds of missed opportunities. If we had social
information technologies helping us to interact with each other more
successfully, this would unleash unimaginable social and economic potentials.
If we had suitable tools to assist us, the large diversity of people with
different cultural backgrounds and interests wouldn't be a problem anymore. Rather
than producing conflict, diversity would increasingly turn into an opportunity.

In summary, Social Information Technologies
will help us to avoid bad interactions, to discover opportunities for good
interactions, to engage in them successfully, and to turn bad interactions into good ones.
In this way, coordination failures and conflicts can be considerably reduced. I,
therefore, believe that Social Information Technologies could produce enormous value
– be it material or immaterial. Just
remember that Facebook is worth more than 50 billion dollars, even though it is
based on a very simple principle: social networking. How much more valuable
would Social Information Technologies be? But I don't want to argue for big
business here. In fact, if we created these technologies in a crowd-sourced way
for the public good or just for fun (as Linus Torvalds, the initiator of the Linux
operating system, said) – even better!

Towards distributed cybersecurity, based on
self-organization

Since the Arab Spring, governments all over
the world have become worried about "twitter revolutions". Are social
media destabilizing political systems? Do governments therefore have to censor
free speech or influence at least the way tweets or facebook posts are
distributed to followers? I don't think so. Biasing free speech will rather
affect a society's ability to detect problems and address them early on.

But wouldn't a system based on the
principle of distributed bottom-up self-organization be insecure? Not
necessarily so! Let me give an example. One of the most astonishing complex
systems in the world is our body's immune system. Even though we are bombarded
every day be thousands of viruses, bacteria, and other harmful agents, our immune
system is pretty good in protecting us for usually 5 to 10 decades.

Our immune system is probably more
effective than any other protection system we know. And what is even more
surprising: in contrast to our central nervous system, the immune system is
organized in a decentralized way. This is not by chance. It is well known that
decentralized systems tend to be more resilient to disruptive events. While targeted
attacks or point failures can make a centralized system fail, a decentralized
system will usually survive the impact of attacks and recover. In fact, this is
the reason for the robustness of the Internet. So, why don't we build
information systems in ways that protect them by "digital immune
systems"? This should also include a reputation system, which could be
called a "social immune system".

Managing the chat room

Information exchange and communication on
the Web have quickly changed. In the beginning, there was almost no regulation
in place. These were the days of the “Wild, Wild, Web”, and people often did not
respect human dignity and the rights of companies when posting comments.
However, one can see a gradual evolution of self-governance structures over
time.

Early on, public comments in news forums
were published without previous screening, and this spread a lot of low-quality
content. Later, comments were increasingly assessed for their lawfulness (e.g.
for respecting human dignity) before they went online. Then, it became possible
to comment on comments. Now, comments are rated by readers, and good ones get
pushed to the top. The next logical step is to rate commenters and to rate
raters. Thus, we can see the evolution of a self-governing system that channels
the free expression of speech into increasingly constructive paths. I, therefore,
believe it is possible to reach a responsible use of the Internet mainly on the
basis of self-organization.

In the end, the great majority of malicious
behaviors will be handled by crowd-based mechanisms such as the reporting of
inappropriate content and a reputation-based display of user-generated Web
content. A small fraction will have to be taken care of by a "chat room
master" or moderator, and there will be a hierarchy of complaint instances
to handle the remaining, complicated cases. I expect that, only a few cases
will have to be taken care of by courts or other institutions, while most
activities will be self-governed by social feedback loops in terms of sanctions
and rewards by peers. In the following chapters, I will elaborate in more
detail, how information technologies allow top-down and bottom-up principles,
but also people and companies, to come together in entirely new ways.

INFORMATION BOX 1: Creating a trend for the
better

For reputation systems to work well, there
are a number of further things to consider: (1) the reputation system must be
resistant to manipulation attempts; (2) people should not be terrorized by it,
or by rumors; (3) to allow for more individual exploration and innovation than
in a village, one would like to have the advantages of the greater freedoms of
city life – but this requires sufficient options for anonymity or pseudonymity
(to an extent that cannot challenge systemic stability).

First, to respect the right of informational
self-determination, a person should be able to decide what kind of personal
information (social, economic, health, intimate, or other kind of information)
it makes accessible for what purpose, for what period of time, and to what
circle (such as everyone, non-profit organizations, commercial companies, friends,
family members, or just particular individuals). These settings would, then,
allow selected others to access and decrypt selected personal information. Of
course, one might also decide not to reveal any personal information at all.
However, I expect that having a reputation for something will be better for
most people than having none, if only to find fitting people who have similar
preferences and tastes.

Second, people should be able to post the
ratings or comments entered in the reputation system either in an anonymous,
pseudonymous, or personally identifiable way. But pseudonymous posts would
have, for example, a 10 times higher weight than anonymous ones, and personal
ones a 10 times higher weight than pseudonymous ones. Moreover, everyone who
posts something would have to declare the category of information: is it a fact
(potentially falsifiable and linked to evidence allowing to check it), an advertisement
(if there is a personal benefit for posting it), or an opinion (any other
information)? Ratings would always have the category "opinion" or
"advertisement". If people use the wrong category or post false
information, as identified and reported by, say, 10 others, the weight of their
ratings (their "influence") would be reduced by a factor of 10 (of
course, these values may be adjusted). All other ratings of the same person or
pseudonym would be reduced by a factor of 2. This mechanism ensures that
manipulation or cheating does not pay off.

[1]Dear
Reader,thank you for your
interest in this chapter, which is thought to stimulate debate.

What you are seeing
here is work in progress, a chapter of a book on the emerging Digital Society

I am currently
writing. My plan was to elaborate and polish this further, before I share this
with anybody else. However, I often feel that it is more important to share my
thoughts with the public now than trying to perfect the book first while
keeping my analysis and insights for myself in times requiring new ideas.

So, please apologize
if this does not look 100% ready. Updates will follow. Your critical thoughts
and constructive feedback are very welcome. You can reach me via dhelbing (AT) ethz.ch or
@dirkhelbing at twitter.

I hope these materials
can serve as a stepping stone towards mastering the challenges ahead of us and
towards developing an open and participatory information infrastructure for the
Digital Society of the 21st century that would enable everyone to take better
informed decisions and more effective actions.

I believe that our
society is heading towards a tipping point, and that this creates the
opportunity for a better future.

FuturICT Hubs

Followers

FET Flagship Initiative

The activities leading to these results has received funding from the European Union Seventh Framework Programme (FP7/2007-2013) under grant agreement n° 284709 - project 'FuturICT', a Coordination and Support Action in the Information and Communication Technologies activity area